Schneiderman says high-frequency traders undermine confidence

High-frequency trading, and early access to market-moving information and analyst reports threatens and undermines confidence in the financial markets, state Attorney General Eric Schneiderman says.

“When blinding speed is coupled with early access to data, it gives small groups of traders the power to manipulate market movements in their own favor before anyone else knows what’s happening,” Schneiderman said during an appearance at the annual Bloomberg Markets 50 Summit on Tuesday.

The newest form of insider trading undermines the markets be setting up a small minority of traders to receive enormous profits at the expense of the rest of the market, he said.

The attorney general’s office has established a hotline at 1-800-771-7755 for financial industry insiders to report improper or illegal conduct.